S.B. No. 324 mandates that state contractors, political subdivisions, and private employers in Texas participate in the federal E-Verify program to verify employment authorization for new employees. The bill amends Chapter 2264 of the Government Code, changing its heading to reflect "Certain Restrictions on Public Subsidies and State Contracts." It introduces new sections that outline the requirements for contractors to register and participate in the E-Verify program, including a stipulation that contracts with state agencies must include a certification statement regarding eligibility under the E-Verify program. Additionally, the bill allows the comptroller to bar contractors from state contracts if they fail to comply with these requirements.

The legislation also establishes new provisions in the Labor Code and Local Government Code, requiring employers and political subdivisions to verify employee information through the E-Verify program. It specifies that employers cannot misclassify employees as independent contractors to evade these requirements. Furthermore, it sets enforcement mechanisms, including potential termination of employees responsible for compliance failures within political subdivisions. The bill outlines a timeline for state agencies to develop necessary procedures and rules, with the act taking effect on September 1, 2025, and certain provisions applying starting January 1, 2027.

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